Marketers Need Transparency with Consumer Data
With data breaches seemingly becoming a daily occurrence, most consumers are more concerned about their privacy than ever, according to research from Publishers Clearing House (PCH) Consumer Insights.
Nearly 6 in 10 (58 percent) of respondents will stop interacting with companies that have bad reputations around data, and 52 percent are willing to stop using companies that don’t provide an option not to track personal data, the survey said.
“When consumers were asked what they consider to be personal data, they overwhelmingly indicated that all of their data is considered personal,” PCH Consumer Insights says in a whitepaper detailing the research. “This tells us that for any category, including voice patterns, emails, calendar appointments, and more, consumers consider this information to be personal.”
Consumers are most concerned about the privacy of their bank information, according to the report, with 89 percent citing bank data as personal. Bank data was followed by health information (cited by 85 percent), phone numbers (85 percent), home addresses (84 percent), and online credit card purchases (83 percent). Also topping 80 percent were locations, email addresses, and fingerprints.
“The data economy is all-encompassing in Americans’ lives. It impacts everything we do,” the report adds.
Thirty-eight percent of those surveyed said they never want to share their data, while only 2 percent said they would do so in exchange for knowing about new products and services.
“People are beginning to think of their data as an asset, something that they own,” the report says. “Marketplace trends point to shifting power away from corporations and into people’s hands as they seek to educate themselves and control their own data.”
Companies relying on CRM data should pay close attention to consumer privacy concerns, PCH Consumer Insights says. “People expect companies to protect their personal information and data and are willing to take action against those that don’t. The Cambridge Analytica data breach, for example, not only exploited people’s data, it tarnished Facebook’s brand.”
That breach, in turn, likely contributed to the failure of products like Facebook’s Portal, according to PCH. Portal wanted users to use a Facebook camera in their homes.
Whitepaper co-author Tiffany Johnson, who founded Xente Data and teaches at New York University, advises marketers to ensure that they offer consumers choice and transparency in the collection and use of first-party data.
“This will allow them to rethink their data strategy to make sure that they hear from their loyal customers,” Johnson says. She adds that marketers shouldn’t hound consumers with retargeted ads and marketing.
“That actually saves you money,” Johnson explains, noting that trying to retarget prospects who have shown little or no interest offers little, if any, return. “They can rethink their digital strategy for how they will use their data to further their business and not waste as much money.”
Marketers should also explain to consumers why they are collecting the data, which will help consumers be more “data-literate,” adds research co-author Daniela Molta, assistant professor of digital advertising at Syracuse University’s S.I. Newhouse School of Communications.
“People really need to reassess their data strategies because it’s good for business,” Molta says, adding that companies should go beyond the disclosures required by law to be extremely transparent with their data methods and uses.
Other recommendations in the whitepaper include the following:
- As consumers seek to educate themselves and control their own data, the power of data protection is shifting away from businesses and into the hands of consumers—and marketers need to adapt.
- A lack of education about data security is a societal issue that works against marketing goals and erodes consumer trust, so data literacy needs to start in kindergarten and continue to be taught throughout a person’s life, including in the workplace.
- Data literacy issues will be exacerbated by the continued proliferation of AI. Americans already struggle to understand how their data is used in business and advertising practices, so it’s likely they’re even more unaware of how their data is being used to train AI models.
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